Data Privacy and Protection Series – How to Build Consumer Trust in Financial Services with Data Privacy and Protection
Part 4 of a 6-Part Series
Financial services providers constantly weigh the importance and impact of providing an exceptional consumer experience with the need to safeguard and properly use personal data. But increasingly, the concept of data privacy and protection is becoming more than a compliance issue. It’s also a critical element in earning and keeping consumer trust.
As one of the largest holders of sensitive personal data, the financial services industry has unique insight into how consumers perceive and value their offerings – and the behavioral triggers that impact money management decisions. This level of insight opens the door to a variety of opportunities for self-differentiation.
It’s in the very nature of the business to collect, process, and store sensitive personal information. Yet, consumers are increasingly concerned that the security of their personal data is slipping through the cracks. Recent McKinsey research indicates that trust in banks is declining, with the majority of consumers in Western markets reporting that the relationship falls short of their expectations.
In financial services, data privacy and protection is becoming the cornerstone of the overall consumer experience. Navigating it effectively requires a balance between personalizing the consumer experience and rigorously integrating personal data consent and preference management.
Balancing personalization and consent and preference management
Whether commercial or retail banking, wealth or retirement management, or any other financial services sector, consumers expect to be treated consistently, regardless of geography, or which function of the Bank they deal with. This expectation is at odds with the increasingly restrictive regulatory framework, where data sovereignty and tighter data privacy controls are becoming business as usual.
Delivering such a trusted experience requires financial services providers to not only collect customer data, but also share personal information, the essence of conversations, and the details of every interaction across entities and regions. In most cases, this intelligence is generated by and resides in disparate systems – all of which must:
- Be compliant with different legal frameworks
- Align with various jurisdictions
- Ensure standardization across all business software
Managing, analyzing, reporting, and securing data confidentiality begin with a current and comprehensive map that shows what the intelligence means, where it lives, who owns it, and why it was collected in the first place. Insights drawn from this map allow providers to pinpoint high-risk data sets and flag data flows and access patterns that violate defined customer preference and consent rules. Additionally, these insights enable organizations to better manage retention timelines and ensure that data is disposed of properly when it’s no longer relevant for business operations – or when the consumer wants to be forgotten.
Reducing risk exposure through automation
Unfortunately, many front- and back-office data management processes are still too manual to comply with data consent and preference rules. Take, for example, data reconciliation, which can take upwards of six days to remedy manually. Organizations that move to an automated system can complete the process within three minutes, continuously.
This gap of five days, 23 hours, and 57 minutes underscores that most financial services providers routinely run their operations on inconsistent, outdated data. Employees do not have access to the right information and cannot compare data from different areas because it doesn’t exist in the IT system. More importantly, no one has the visibility into whether personal data is captured, stored, and used appropriately from day one.
Once data management processes are automated, data privacy and protection can be tightly controlled. This approach gives consumers confidence in the financial services they trust – and the security of their data, money, and investments. With a single source of unified personal data across on-premise, cloud, and hybrid deployment environments, organizations can simplify the real-time management of consumer consent and preferences.
In addition to bolstering consumer trust, taking this step dramatically lowers risk exposure for consumers and the business. Providers can define policies for federal and regional regulatory requirements, retention of aging data, and removal of redundant data and unnecessary risk. Furthermore, they can detect violations in data movement and permissions, while managing data rights and deletion with extensible workflows, removal validation, and end-to-end fulfillment requests across any data.
Build consumer confidence
“Put the customer first.” It’s one of the oldest business principles that’s stood the test of time. As consumer experiences become more data-driven, personalized, and relationship-oriented, the success of financial services providers will depend on how well they follow that wisdom.
Automation technology empowers providers to take a fresh approach to capturing, discovering, inventorying, and managing personal data. Financial services can not only balance the personalization consumers want with the data privacy and protection they need, but also strengthen long-term trust and loyalty.
Want to know how SAP can help? Learn about SAP Solution Extensions from BigID.
Did you miss any of the blogs in our Data Privacy and Protection series? Read about the topics we’ve covered so far: